Subject: Statistics and Probability

Course: PADM 60381

Dataset: states_REG Dependent Variable: Cigarette consumption (cigarettes) Using the cigarette consumption variable as your dependent variable and the cigarette tax (cig_tax) asyour key explanatory variable, do the following: 1. Run a bivariate regression between cigarette consumption (cigarettes) and cigarette taxes (cig_tax). [NOTE: This should be the same model complete in the Bivariate Statistics Assignment]. 2. Run a multivariate regression model with the following control variables (include the results in your homework). NOTE: For the multivariate regression, you should include these variables in the model as a control in addition to the cig_tax variable from the bivariate model a. Percent of the population with a college degree (college) b. Percent of the population aged 18-24 (pop_18_24) c. Per capita income (prcapinc) d. Percent urban population (urban) 3. Rerun the model, but this time, also control for Southern states (south). NOTE: This variable shouldbe added to the model above (i.e., you should have 6 IVs in this model). Answer the following questions: 1. Is the hypothesis that higher cigarette tax rates are associated with lower consumption supported? (provide an answer for all three models). NOTE: Discuss bothsubstantive and statistical significance. 2. What variables are statistically significant in the third model? 3. Based on the third model, if taxes in a state were to increase by $0.50, what would the expectedimpact be on cigarette consumption? 4. How well do these models explain variation in cigarette consumption? (i.e., R2) 5. Which model do you consider to be the best model? Why?

The assignment should be submitted as an Excel file with your results.

The data link is below. Copy and paste the URL; the link will give access to the data needed for this homework assignment.

https://docs.google.com/spreadsheets/d/1--eSvAYAIkQ4dRppiceZ3mUb-NA34rzc/edit?usp=share_link&ouid=106596741055892912212&rtpof=true&sd=true